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Modern society runs on refined oil products, can California keep ignoring reality?

By Ronald Stein and Jonathan J. Ariel - posted Wednesday, 3 June 2026


An energy "reality" reminder is that crude oil by itself is useless black tar, unless you build a multi-billion-dollar refinery to break it down to produce various types of transportation fuels, and oil derivatives that are the basis of the products in our materialistic world.

Without refineries to manufacture that useless black tar that we call crude oil, into usable transportation fuels and oil derivatives that are the basis of more than 6,000 products in our daily lives, we're back to the 1800's.

Why are the California "users" of the products and transportation fuels made from crude oil,

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and the politicians who hate the guts of in-state refineries, want to drive them out of business?

  • Since 2023 California Crude Oil Refining Capacity has dropped by 35%.
  • Crude oil production capacity in California is in terminal decline, resulting in the State importing from foreign countries more than 60% of the crude oil demands of in-State refineries.
  • Even now, given the amount of transportation fuels that California is importing from foreign countries, the State continues its vulnerability level of being a National Security Risk to America.

Refineries are the supply chain source of those products and transportation fuels made from crude oil that has allowed the world to sustain 10 times more people today (8.3 billion) than at the start of the Industrial Revolution of approximately 700 to 800 million people in 1750.

There's something wrong with this picture to rid the world of the suppliers of the products demanded by the economy as the products from refined crude oil, in addition to supporting more than 8 billion people on this planet, have helped hospitals, doctors, and medications, to extend life longevity from 40 to 75+ during those few centuries since 1750.

California in-state refining capacity for transportation fuels continue to diminish:

  • Two refineries have converted over to manufacturing renewable diesel. In these cases, 350,000 barrels of crude oil processing per day has dropped offline. They no longer produce gasoline or jet fuel of any volume.
  • Within the last seven months California policies have driven two other refineries, Phillips 66 in Wilmington and Valero in Benicia to shut down operations and leave the State.
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The closure of 2 refineries in California have increased total transportation fuels of gasoline, jet fuel, and diesel needing to be imported from Asian refineries. This has made California vulnerable to many scenarios which could quickly generate supply shocks or shortages for the entire USA. Some of these scenarios include Port problems, weather issues, unscheduled refinery downtimes, or a significant global event.

  • In the case of the Iranian war that vulnerability has never been so clear.
  • Due to the closure of the strait of Hormuz crude oil supplies to Asian refineries have dropped off dramatically.
  • Asian refineries have been forced to cut back their crude oil charge rates. This forced them as of late March to suspend shipments of gasoline, jet fuel, and diesel that they have been supplying California.

California's policies are forcing the hands of Chevron, PBF, and Marathon, the three remaining oil corporations in California. Together they own six of the remaining seven operational refineries in the state. Between February 26th of 2026 and March 9th these companies did something unprecedented by dispatching three letters to the Governor and the state air board. While they have some varied details they are all very specific on two points:

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This article was first published by America Out Loud News.



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About the Authors

Ronald Stein is co-author of the Pulitzer Prize nominated book Clean Energy Exploitations. He is a policy advisor on energy literacy for the Heartland Institute, and the Committee for a Constructive Tomorrow, and a national TV commentator on energy & infrastructure with Rick Amato.

Jonathan J. Ariel is an economist and financial analyst. He holds a MBA from the Australian Graduate School of Management. He can be contacted at jonathan@chinamail.com.

Other articles by these Authors

All articles by Ronald Stein
All articles by Jonathan J. Ariel

Creative Commons LicenseThis work is licensed under a Creative Commons License.

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